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Robert J. Samuelson: Economics lacks the vocabulary to explains what is happening

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  • Semi-Strong Louisville, KY
    Dec. 5, 2013 11:07 a.m.

    SEY,

    The Fed certainly influences but does not control the economy. Never has.

    Mister J,

    Hence my reference to Marriner Eccles who began his tenure in 1934. The Fed was significantly strengthened during his watch.

  • UtahBlueDevil Durham, NC
    Dec. 5, 2013 9:31 a.m.

    @Nate - "Doesn't he have a Nobel prize, or something?"

    So does Obama... and your point is?

    At a high level.. I agree with your comments... but then you throw in silly talk radio/FoxNewsish statements like "Obamaphone" and then we fall all the way back into school ground name calling. There is no Obamaphone... that programs has been in place for decades. It has been on everyone's phone bill since I was a small kid many decades ago.

    If we can stick to working on problems, rather than pretending these are all issues that magically arose in the last 5 years... we might be able to get somewhere. But once it slips down that slimmy path of partisan politics, we get dug into the mud where no one is able to get ahead.

    I agree... we need to get americans off of the "system", and hungry to get ahead like they are in other parts of the world. We need to convince certain segments of society they can win, and must win. How we do that though... is a matter of debate.

  • Mister J Salt Lake City, UT
    Dec. 5, 2013 9:28 a.m.

    Re: UtahBlueDevil (12/3)

    Because most people have been conditioned into thinking it’s the pinnacle of success to make a boatload of $ by working only 4 hrs a day.

    Re: Semi-Strong (12/4)

    The Fed was created in 1913 and look at the economic cycles since. For giggles, look at the economic cycles prior to 1907 which was the crisis that was responsible for the Fed Creation. If you honestly think that it was all sunshine & lollipops on Jekyll Island in Nov 1910 then you need a reality check.

  • Nate Pleasant Grove, UT
    Dec. 4, 2013 8:06 p.m.

    @UtahBlueDevil "all you did was provide more opinion unbacked by a single number. Not a one."

    That's odd. I distinctly remember sending you a 7 and a five.

    "Even at 7 percent, it is hardly unprecedented or exceptional, and fall well short of 'depression' levels."

    Take it up with Paul Krugman. I know his statement was probably a case of inadvertent friendly fire. Doesn't he have a Nobel prize, or something?

    You've been mighty short on numbers yourself. I do keep seeing 4.7. Were you thinking Samuelson's article was only about Utah?

    "Those chronically unemployed now are those who simply lack skills...."

    Okay, progress. You admit that there is chronic unemployment. The modern welfare state is one of those bad ideas that produces chronic unemployment and people lacking in skills. It does a very poor job of preparing people for the economic competition you've been talking about. The human spirit needs more than just an unemployment check and an Obamaphone. It needs a renewal of freedom, and will stay depressed until this occurs.

  • CLM Draper, UT
    Dec. 4, 2013 6:37 p.m.

    Tyler D is grateful to the FED for keeping us out of panics, booms & busts, bank closures? From losing our retirement regularly? The worst boom/busts, depressions, recessions, and bank closures have come *since* the creation of the FED. The FED is *responsible* for them!

    We would not experience such dramatic economic swings were it not for monetary policies of the Federal Reserve that distort real prices and encourage high-risk, high-leveraged investment decisions. Boom and bust cycles and the bank closures they precipitate are inevitable when government interventions confuse market participants.

  • SEY Sandy, UT
    Dec. 4, 2013 5:30 p.m.

    Nice to see marxist get something right. What he doesn't understand, however, is that a planned economy of any degree is doomed to muddle along if not eventually fail. That's where we are right now precisely because of central planning. NO ONE, including brilliant Nobel Prize winners or all-wise Marxists are capable of planning better than individuals making their own economic decisions. If you want to understand the futility and wrong-headedness of bureaucratic central planning, read Ludwig von Mises. He's had it right for over 90 years. It's way past time for the US to apply his insights.

  • marxist Salt Lake City, UT
    Dec. 4, 2013 4:10 p.m.

    It has been argued that we have a centrally planned economy NOW, but that it is managed for the benefit of the few, the top 1%. Here's how it works. The heart of the modern American capitalist system is the banking system, and the heart of the banking system is the quasi-public Federal Reserve System (the Fed). The Fed controls the money supply (central planning if there ever was). When the banking system got itself in trouble by marketing phony securities, and collapsed cutting off credit to everybody; the Federal government and the Fed rescued the banks by buying stock in them and by flooding the system with newly created money (still going on, loaned to the banks at little or no interest. This saved the banks and likely saved us from Great Depression II, but little has trickled down to the troops. The stock market soars and things are great at the top with soaring profits and an increasingly top heavy distribution of wealth and income.

    This can't go on indefinitely. We socialists also believe in a degree of central planning, but we think that planning should benefit the masses of people. The clock is ticking.

  • UtahBlueDevil Durham, NC
    Dec. 4, 2013 4:00 p.m.

    @nate…. all you did was provide more opinion unbacked by a single number. Not a one.

    ""depression-like conditions""…. he was talking about 20 to 30 percent unemployment. If anyone things that Utah's 4.7 percent unemployment is depression like…. then they are suffering from too much hype, and too little reality. Even at 7 percent, it is hardly unprecedented or exceptional, and fall well short of "depression" levels. Just because people feel a certain way, doesn't mean it is true. Go to your local mall on a saturday, and tell me there is a problem with people not shopping.

    The problem is how people do things is changing - regardless of administration. Black friday in store numbers were off…. but web sales were through the roof. Those chronically unemployed now are those who simply lack skills, not that there aren't jobs there. Even if we had Ronald Reagan in office, he would not be able to turn back this tide.

    Americans are going to have to compete harder for jobs… your job competition isn't across the street, but is in India, China, Japan, Brazil, Israel, Russia, Czech Republic…. get used to it.

  • CLM Draper, UT
    Dec. 4, 2013 3:00 p.m.

    I'd like to understand how claiming that the Federal Reserve controls the economy is a conspiracy theory when the following facts are indisputable:

    --The Fed has the lever to create (out of thin air) money (money supply), which is achieved through lending it to the government and FED member banks.

    --All money in circulation is borrowed from the FED. In this way the FED controls all lending of its FED Reserve notes.

    --The Fed has the lever of interest control over all money, directly and indirectly through their "FED rate," which is the FED member banks borrowing rate. All borrowed/created money from the FED has an interest rate attached.

    --To control the economy, which is based upon the cost of its money supply, all they have to do is raise or lower interest rates which in turn increased or decreases lending. To drive the economy up, they reduce interest rates and free up lending (supply). To create a recession, they do just the opposite.

    The best example of how this works is to take a good look at our current economic situation.

  • Tyler D Meridian, ID
    Dec. 4, 2013 2:12 p.m.

    Hard to predict how things would have been but for X, Y, Z (counterfactual), but I would guess that without the Fed, our economy (which by extension now means the global economy) would look similar to what we had in the late 1800’s early 1900’s – regular panics, devastating booms & busts, banking failures.

    The rich (so long as their wealth is not all debt financed) have always weathered such storms, but many of the rest of us, depending on forces totally out of our control, would be wiped out regularly – goodbye retirement savings, college funds, home equity, etc…

    I’m glad we have the Fed, especially with today’s political gridlock – given our partisan divide, without the Fed we would likely be in the middle of a full scale depression.

    And the issue of banks being too-big-to-fail notwithstanding (I agree with SEY), I’m not sure how the Fed is the engine of crony-capitalism given that QE simply greases the wheels of the entire machine.

  • Nate Pleasant Grove, UT
    Dec. 4, 2013 1:03 p.m.

    @UtahBlueDevil "back your comments with some facts....Show me how the economy is in shambles."

    There's a link up top that says "Return to article." Follow that, if you need to review what we're all talking about today. Specifically, "the unemployment rate has exceeded 7 percent for almost five years, despite the withdrawal of millions of discouraged workers from the labor force. Moreover, public attitudes have become deeply pessimistic...." Krugman is talking about "depression-like conditions" that might last for decades.

    My previous comments assumed everyone did the reading.

    "Show us these 'unforeseen, negative consequences'.... what are they?"

    Cash for Clunkers hurt the poor by removing from the market the only cars they could afford. Porkulus failed to stimulate the economy and flushed a bunch of money down the green energy toilet into companies that went bankrupt, creating excessive debt that put a damper on investment and job creation. Obamacare made health care unaffordable for the young and healthy who are expected to pay the tab for everyone else. The "one-sixth" reference was to health care, which I suppose you think is going swimmingly. It's not.

    "cowboy economics"

    In practice, liberty beats central planning every time.

  • SEY Sandy, UT
    Dec. 4, 2013 12:38 p.m.

    Semi-Strong: it's possible to have an economic discussion without involving the Fed as long as you want to pretend that they're not controlling the economy. You won't have your ideal captain with a steady hand at the tiller because any captain will be bought and paid for by the crony-capitalist cartel I mentioned.

  • Semi-Strong Louisville, KY
    Dec. 4, 2013 11:31 a.m.

    Can we please have an economic discussion which does not end in conspiracy theories with the Fed acting as the Illuminati?

    Overall, our economy has been much less subject to boom and bust since the days of Marriner Eccles.

    The current problem was, in part, due to the chairman drinking the bilge water of markets always regulating themselves.

    And they do. After the fireball (and assuming you live through the fireball).

    We need to go back to having a steady hand at the tiller with neither too little nor too much regulation.

  • CLM Draper, UT
    Dec. 4, 2013 9:07 a.m.

    Listen to SEY, he has presented the entire problem in a nutshell...not to mention a the most important economic vocabulary which should be hearkened to by all. If you think SEY might be on to something, I'd suggest David Stockman's The Great Deformation for further reading.

  • UtahBlueDevil Durham, NC
    Dec. 4, 2013 8:53 a.m.

    @Nate... back your comments with some facts. Show me how the economy is in shambles. Show me how Utah's employment or economic picture is worse than it was when Obama took office. Show us something more than just opinion based rhetoric.

    Show us these "unforeseen, negative consequences".... what are they? Back them with something other than opinion.

    Feel free to live in a world where you think cowboy economics can compete on a global competitive stage. Good luck with that one... I wish you the best.

  • Nate Pleasant Grove, UT
    Dec. 4, 2013 7:25 a.m.

    @UtahBlueDevil "Somehow, the belief that if we just had different people in office, the world dynamics would radically change."

    What matters most is the ideas in the heads of the people in office. Obama's HopeAndChange turns out to be nothing but stale, discredited 1970's liberalism. Why are we surprised to find ourselves in a repeat cycle of Jimmy Carter malaise?

    From Cash-for-Clunkers to Porkulus, his ideas have led to all these unforeseen, negative consequences. (Unforeseen to him.) How many times to we have to endure watching him "pivot to jobs" before we conclude that he doesn't know the first thing about jobs? He doesn't know much about anything -- he's only a community agitator who got promoted above his level of competence. Now he has gained control of one-sixth of the economy, and made a shambles of it.

    All this came about because he was pursuing erroneous ideas. Ideas have consequences. Centralized control of an economy doesn't work. No individual or elite group is smart enough to make personal decisions for 300 million people. The people are better off deciding things for themselves.

  • SEY Sandy, UT
    Dec. 3, 2013 11:08 p.m.

    What we are seeing today is a cartel formed by the Federal Reserve, their associated banks and the Treasury Department. They have virtual control of the economy which can accurately be labled "crony-capitalism." The banks that were too-big-to-fail are now even bigger and more dangerous than ever. They have become their own state within a state that exists above the laws that apply to everyone else. They are the "untouchables" out of the reach of all branches of government. When the system finally implodes, look no further than the crony-capitalist cartel for the reason.

  • UtahBlueDevil Durham, NC
    Dec. 3, 2013 5:41 p.m.

    I find all this "ideologically" based rhetoric most amusing. Somehow, the belief that if we just had different people in office, the world dynamics would radically change. Today I just reviewed the hiring request of one of the companies I do work with to assess skills gap. This list of open, unfilled positions was 23 pages long.

    These were all well paying jobs, some six figure in size. Most of these jobs will be filled by people not from the United States of America - because they can. This false sense of security we lulled ourselves into, that we don't any longer need to be competitive with our global trading partners, that business will just flow our way, is a myth that is being busted in front of us. US growth will not continue just because we have some manifest destiny.

    America is still dominant in many industries, but our lack of innovation will not keep us ahead for long. Many countries are investing huge amounts on competitiveness. There used to be two countries with space programs. Now more than a half dozen, and growing. Meanwhile, fiscal conservatism has stripped off funding for pure science as being wasteful pork spending.

  • pragmatistferlife salt lake city, utah
    Dec. 3, 2013 4:50 p.m.

    Patriot, " How about sending those 90 million out to work daily in some kind of service and make them earn it" This comment is not just offensive from a reality perspective, it is massively uninformed. You insinuate (kind turn of a phrase) that those who receive SNAP are lazy sit on their backside takers.

    Here's the facts from the office of budget and policy.."The overwhelming majority of SNAP recipients who can work do so. Among SNAP households with at least one working-age, non-disabled adult, more than half work while receiving SNAP — and more than 80 percent work in the year prior to or the year after receiving SNAP. The rates are even higher for families with children — more than 60 percent work while receiving SNAP, and almost 90 percent work in the prior or subsequent year. "

    This denigration of the working poor is the very reason you won't see a Republican President until you give up this fantasy. These people can and do vote. They aren't looking for "free stuff" they are looking for a hand while they work for poverty wages.

  • 10CC Bountiful, UT
    Dec. 3, 2013 3:01 p.m.

    I'm no Marxian economist but I was the beneficiary of having taken a number of economics classes from dyed-in-the-wool Marxian economists, and I wholeheartedly agree with "Marxist"'s observation that we're less well off in explaining reality because of the lack of a Marxian viewpoint in the political mainstream.

    It's obvious that the Soviet and Cuban economic experiments failed, and in terms of finding a better way, the "real" socialists have failed.

    But the Marxian background I got in college was hauntingly predictive of the struggles and issues we see today in how Capitalism functions.

    American visionaries such as Teddy Roosevelt and Henry Ford, who recognized the destructive potential in our system and promoted humane "softening" of the hard edges are the examples to follow, in my judgment.

    The raw forces of Capitalism too often twist people, and turn good people into swindlers. We've all seen a corrosive effect on society and the individuals who compose it, without a doubt.

    The answer is not to throw out Capitalism altogether, but to tame it, and make it serve the interests of human beings, and not the other way around.

    Easier said than done, granted.

  • marxist Salt Lake City, UT
    Dec. 3, 2013 2:42 p.m.

    Moreover, we of the Wasatch Socialist Party intend to provide the economist Marx a thorough airing, since the economics fraternity hereabouts won't. We're willing to take our lumps in the process. This is important. Stay tuned.

  • marxist Salt Lake City, UT
    Dec. 3, 2013 2:40 p.m.

    RE: Tyler D "Besides the obvious reasons you mention I think this is because Marx was less an economist (certainly in any applied rigorous sense) and more a political theorist as well as an iconoclast." Most people have no idea what Marx was about as an economist. "Capital" Marx's most important (but not only) work is of the highest rigor. Joan Robinson, the famous "Mrs. Robinson" of economics, also thought so BTW. I repeat, Marx is unknown in American economics and by the public in general. He needs a hearing. What's the risk?

  • CLM Draper, UT
    Dec. 3, 2013 2:37 p.m.

    Here's one piece of economic vocabulary that explains what's happening, but we rarely hear anyone put the blame where it belongs: The Federal Reserve.

    The federal government could never have accumulated debts of the magnitude that the US now holds without a central bank to be its "buyer of last resort." The Fed caused the Great Depression, it caused the 1970s Stagflation, and it has only become worse since Alan Greenspan's appointment during the Reagan era. The past 6 years with zero interest rates have caused massive speculation. The Fed tells the world untruths about the cost of money, the cost of risk, and how to allocate capital. Wall Street wins, Main Street loses--over and over again. Getting the Fed out of the financial markets is the only way to put free markets and genuine wealth creation back into capitalism.

  • procuradorfiscal Tooele, UT
    Dec. 3, 2013 2:15 p.m.

    Re: "But as Freud is to psychology, Marx is to economics."

    If by that you mean, thoroughly and irretrievably discredited, I'm with you.

    I've said it before -- it never ceases to amaze that otherwise intelligent people would continue to espouse a theory that has such a long and gory history of failure.

    It seems the height of liberal hubris to suggest that, even though marxist theory has resulted in death, destruction, and chaos EVERY time it's been tried, the past is somehow irrelevant and that history obliges us to try it again in America.

    Do modern American liberals really believe they're that much better, brighter, more insightful, more compassionate, or more righteous than their Russian, Chinese, North Korean, Cuban, Romanian, Yugoslav, Bulgarian, East German, Burmese, Vietnamese, Bolivian, Venezuelan [etc., etc.] counterparts?

    If so, how so?

  • Semi-Strong Louisville, KY
    Dec. 3, 2013 1:57 p.m.

    Marxist,

    You overstate his importance. Freud was the father of psychoanalysis. Adam Smith was the father of modern economics. Whatever place Marx might or might not have, it is in clear second position to Smith.

  • Tyler D Meridian, ID
    Dec. 3, 2013 1:26 p.m.

    @Patriot – “How many churches, charities or parents would help the poor if we kicked the goverment out of it?”

    Not nearly enough to keep millions out of abject poverty, especially given today’s current church membership numbers (i.e., lower than 1930 which couldn’t keep millions of elderly out of poverty).

    @marxist – “I continue to contend that a major problem for economics is that discipline's refusal to let Marx into the fraternity.”

    Besides the obvious reasons you mention I think this is because Marx was less an economist (certainly in any applied rigorous sense) and more a political theorist as well as an iconoclast.

    But even as an economist he held some deeply flawed axiomatic assumptions – namely, the labor theory of value and his lack of understanding of how ideas and entrepreneurial skills contribute value.

    On top of that, he completely misunderstood human nature - how we respond to incentives and how our positive (creative) impulses contribute to economic output. Marx would be lost trying to explain today’s information economy.

    Like Freud he was a good writer but also like Freud his ideas are largely discredited.

  • marxist Salt Lake City, UT
    Dec. 3, 2013 12:09 p.m.

    I am a retired economics professor who has taught the established economics gospel all of his life as per the will of his employers. But I also have a keen appreciation of Marx's theoretical system. I continue to contend that a major problem for economics is that discipline's refusal to let Marx into the fraternity. Marx's model of surplus value and capital accumulation is essentially correct in my view. Marx's absence in the current economics scene has permanently crippled the discipline. Economics indeed needs a new vocabulary - the vocabulary and concepts of Marx.

    Of course I will get the usual flack about what a flop the Soviet Union was, and what a flop Cuba is, etc. But all are beside the point. Marx was a western economist, the last of the classicists, with a uniquely important theoretical model. Because of the cold war he is absolutely taboo. This I understand. But as Freud is to psychology, Marx is to economics. Economics will continue to be laughing stock until he's allowed in.

  • Tyler D Meridian, ID
    Dec. 3, 2013 11:50 a.m.

    @Patriot – “We need conservatives to start trotting out the propaganda machine”

    How about just a robust exchange of ideas and let the people decide which direction they want to go? Sounds better to me than what the Germans were doing in the 1930’s.

    @pragmatistferlife – “Somehow you all don't make the connection between the plight of the top 1% and the plight of the bottom 80% and the whole "wealth redistribution" issue.”

    Excellent comment!

    And all we have to do is go back the Gilded Age (pre-1930’s) to see what our society will look like if we take the conservative policies to their logical conclusions.

    @procuradorfiscal actually makes a great (unintended) case for why the policies started under FDR are necessary at a time when the rich are doing so amazingly well – they sure aren’t pumping all that hoarded cash into jobs though, at least not jobs in this country.

  • Patriot, Herriman, UT
    Dec. 3, 2013 11:46 a.m.

    Pragmatistferlife: We have a record 90 million people on food stamps largely because we allow it. Everytime they eat a meal you or I are paying for it. How about sending those 90 million out to work daily in some kind of service and make them earn it? How many churches,charities or parents would help the poor if we kicked the goverment out of it? I guarantee these groups would manage the welfare of the poor a lot better than government does. You seem to have a real problem with capitalism like most socialist minded folkes. Stop telling us how evil rich CEO's are, the free market always determines how much somebody deserves to be paid.

  • pragmatistferlife salt lake city, utah
    Dec. 3, 2013 11:14 a.m.

    procurodalfiscal, "For the first time in American history, real differences in lifestyle between the richest and poorest among us are so unremarkable, it would astound our ancestors."

    That actually is true thanks to the new economy that was created after WWII and lasted until the mid 1980's. The problem is that economy of value production and CEOs making 20 times what the worker made is at best on it's last legs and more likely gone.

    Now we have nearly 50 million people depending on food assistance programs not to starve (your anorexia statement is ridiculous), it takes nearly 2.5 people working in a household to maintain a sustainable living standard, and we have the largest employer in America holding charity food days for their own employees.

    The entire economy has been twisted to favor a very few. When the top 1% have wealth gains of 200 to 300 percent and the bottom 90 percent are losing wealth just how long do you think that goes on when the difference is being made up by government support?

    Somehow you all don't make the connection between the plight of the top 1% and the plight of the bottom 80% and the whole "wealth redistribution" issue.

  • JoeCapitalist2 Orem, UT
    Dec. 3, 2013 11:10 a.m.

    The "inequality" crowd wants to redistribute wealth on the basis of their perception of what is "fair".

    They constantly try to paint a picture of modern day America as functionally equivalent to the climate of France during the revolution described in "A Tale of Two Cities". They want you to believe that wealthy people today are exactly like the French Aristocracy who drove around in gold plated carriages while vast numbers of "common folk" starved to death.

    We don't have a caste system today. The poorest among us may very well be the richest in just a few years. Poor people today often enjoy a quality of life that was unimagined by wealthy people just a few centuries ago. Obesity, rather than starvation is the bigger health problem among the poor.

    If I have everything I need, why should I care if somebody else has twice what I have (or 10 times, or even 10000 times). Envy and theft are not noble traits even when directed at all those "evil rich people".

  • Patriot, Herriman, UT
    Dec. 3, 2013 10:35 a.m.

    We dont need sophisticated "proper language" gentleman to turn this out of control government around. We need statesmen who will tell the people that this nation is virtually broke! We need conservatives to start trotting out the propaganda machine like the libs have done so well the past 50 years and let the people see where we are headed if we dont start taking some responsibility for our own actions.Let them know the history of other countries who have let their entitlements get away from them. For a closer look tell the people to even look at bankrupt cities like Chicago, LA and numerous other cities in America being run by liberals.You can call these comments idealogical or what ever makes you feel better but when we are both standing in a bread line someday because taxes and inflation have ravaged our economy, I think our ideologies will be the same.

  • Mountanman Hayden, ID
    Dec. 3, 2013 10:25 a.m.

    Median household income fell for the fifth straight year in 2012,(latest available figures) the Census Bureau reported, to $51,017. That was the lowest annual income, adjusted for inflation, since 1995. The government may not call this a recession, but it absolutely is not growth!

  • procuradorfiscal Tooele, UT
    Dec. 3, 2013 10:22 a.m.

    Re: "We have unprecedented inequality . . . ."

    Yeah, unprecedented in it's tiny, tiny amplitude.

    For the first time in American history, real differences in lifestyle between the richest and poorest among us are so unremarkable, it would astound our ancestors.

    Today, the only Americans in serious danger of starvation are those being abused and those suffering from anorexia. America's poor are as likely to have a decent place to live, indoor plumbing, hot and cold water, televisions, refrigerators, cars, and access to recreation as the wealthiest Americans.

    Wealth redistribution occurs an a breathtaking scale in today's America. The most productive Americans are being penalized to subsidize the least productive to a degree unimagined even 20 years ago. Thankfully, there are more of them than ever before.

    Unless the abortive launch of Obamacare results in a well-deserved reversal of its flawed, unsustainable, ultimately dangerous health policy, it'll only get much, much worse.

    Yet, leftists' shrill, disingenuous bleating still centers about the "unfairness" of one person having one or another unimportant bauble that another doesn't.

    Not because there's any actual inequality, but simply for political advantage.

    That's just sad.

  • pragmatistferlife salt lake city, utah
    Dec. 3, 2013 9:10 a.m.

    I think this discussion is a very important discussion to have because without the proper language it's virtually impossible to discern and analyze reality. Just look at the first two comments on this thread, immediate imbedded ideological reactions to a call for something new.

    I don't think there's any question that we are in new economic territory for anyone born after 1940. We have unprecedented inequality, unprecedented debt (both personal and public), unprecedented wealth creation along with unprecedented dependency on public safety net programs, unprecedented low population growth, unprecedented demographic changes, and I could go on for the full 200 words. The point is this isn't 1787, 1942, 1952, or 1982, this is a new reality a reality that demands a new economy and until we start to face this, as Samuelson suggests we're just wandering in the wilderness.

  • Semi-Strong Louisville, KY
    Dec. 3, 2013 9:01 a.m.

    Tyler D,

    The problem with Rational Expectation is we are being constantly schooled (at least recently) to expect the irrational . . .

  • Tyler D Meridian, ID
    Dec. 3, 2013 8:05 a.m.

    I think the most likely explanation is uncertainty of government tax and spending policies.

    In the Rational Expectations school of economic thought, when government accumulates a large amount of debt, instead of treating this like a free lunch citizens will forego investing and hoard cash under the expectation that these funds will be needed (i.e., taxed) to pay down the debt.

    If this is true then the sooner we return to the Clinton tax rates the better. And if we can ever find the political will to shore up our entitlements (which really means reducing healthcare costs) and reform the tax code, this Bush created debt can be paid off and investments will soar.

  • Nate Pleasant Grove, UT
    Dec. 3, 2013 7:57 a.m.

    It's called HopeAndChange.

  • george of the jungle goshen, UT
    Dec. 3, 2013 4:59 a.m.

    Consequence, No one is responsible for their actions.

  • Patriot, Herriman, UT
    Dec. 3, 2013 3:02 a.m.

    The author with his jaded view of our society fails to mention the real and ominous inflation rate that is becoming more apparent daily despite Washington trying to spin the rate differently.He also failed to mention the burgeoning national debt. Two factors that combined with an entitlement minded population, that largely thinks big government should cradle them to grave on the backs of the responsible, does not portend good times ahead for America.